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Under the Radar: Could Mongolia’s June election see a populist upset? www.globalriskinsights.com

Mongolia enters 2017 on the heels of the global commodity slump that torpedoed the country’s economy and provides the backdrop for the upcoming presidential election in June. Mongolia’s economic growth forecast is -0.2% for 2017 – a stark contrast to the runaway, double-digit growth experienced only a few years ago. The country’s economic situation adds an important dimension to the June 26th presidential election, as mounting frustration and disenchantment could provide fertile ground for a political upset.

In order to meet IMF bailout terms, Mongolia passed a supplementary budget, promised to keep the central bank from undertaking any quasi-financial activities, and must carry out an asset-quality review of its banks by November. With a budget deficit of 17% of GDP in 2016 and 11% in 2017, Mongolia hopes that IMF aid and severe belt-tightening will see the budget deficit drop to 4% by 2020. With commodity prices picking up – Mongolia exported year-on-year 446% more coal in Q1 2017 – the IMF predicts a robust 8% growth rate by 2019. So far the signs appear promising, with Mongolian exports up 36% in the first quarter of 2017 compared to last year. Investor confidence also appears to be returning, with March’s seven year, $600 million Khuraldai bond six times oversubscribed.

Whatever else may occur, the fact remains that Mongolia remains fundamentally dependent on commodity exports, especially to China. Consequently, maintaining investor confidence and stability is vital. In the meantime, the upcoming presidential election highlights widespread public anger, and any sabre rattling (and potential surprise win) by populist candidates could seriously jeopardize Mongolia’s goals for the coming years.

Mongolia’s belt tightening and mining bust stoke anger

Longstanding grievances about inequality and a lack of trickle down benefits from the country’s mining boom are now accented by the pain from the conditions of the IMF bailout. While the river of mining money largely passed ordinary Mongolians by, they are now the ones most impacted by the government’s austerity measures. These measures include: increased taxes on tobacco, passenger vehicles, petrol and alcohol as well pay cuts for civil servants. Further changes also include: higher employer and employee social insurance payments, cuts in social service offerings, a raise in the retirement age, and cuts in allowances for children and pensioners.

Wealthy Mongolians are also unhappy, as a reformed progressive tax system raises the top tax bracket to 25% and introduces tax on savings interest. These measures proved so unpopular that the Mongolian Chamber of Commerce threatened to boycott tax payments in protest.

Another source of instability has been the efforts of Mongolian politicians to strengthen the economy on their own terms. Such efforts saw Mongolian People’s Party (MPP) member Davaasuren Tserenpil introduce measures in the 2017 budget requiring foreign companies to bank with local institutions, as well use local commercial bank accounts for sales transactions. In response, Rio Tinto – a major investor and mining operator in Mongolia – complained to the IMF, which in turn delayed bailout payments in early May, expressing concern over the proposals.

Rio Tinto argued that the Mongolian government was increasing taxes on mining firms under the guise of IMF bailout requirements, and that Rio Tinto already uses local banks for employee payments. Moreover, Rio Tinto refuses to use banks with less than an AA rating: the highest rated Mongolian bank – Khan Bank – is rated B- by Fitch and Caa1 by Moody’s. While MPP parliamentarians maintained that the legislation did not pertain to Rio Tinto’s massive Oyu Tolgoi mine (upon completion in 2010, the mine accounted for over 30% of Mongolia’s GDP), legislators have nevertheless bowed to external pressure and amended the budget to ensure the bailout funding is received.

Government accuses media of fake news

This incident highlights the power dynamics at play in the country, with many complaining of the disproportionate power wielded by mining companies, such as Rio Tinto. These sentiments feed into the national discourse in the run-up to the June elections. This is reflected in the controversy surrounding a government bill, the so-called ‘Law of Infringement’ which would allow police to fine individuals up to $41,000 for spreading libelous or defamatory (including via social media) information without having to go to court: this fine is increased to $410,000 for media outlets.

The ruling MPP government has accused the media of spreading false reports and creating division in the months leading up to the election. In response, twelve national broadcasters went dark on April 25th and seven newspapers suspended their websites, with print media outlets also running black front pages in protest. Mongol TV News director Lhagva Erdene argued that the bill represents “[…] the death of opinions and critical thought before the election.”

On the subject of opinions, the 2017 election will see a new policy on opinion polling, with polling now permitted up to 21 days before the election, an increase on the previous limit of 65 days. This will add a new dimension to this election, one that could see a greater role played by reports on public opinion shifts, a situation that benefits populist candidates who capitalize on such swings and their momentum.

Checking out the playing field

The MPP swept legislative elections in 2016, ousting the Democratic Party and securing 65 of 75 seats. The MPP’s victory was in large part due to public discontent over the state of the economy, yet it remains to be seen whether the MPP can continue its winning streak, or if its heavy handed methods combined with lingering economic woes will undermine its chances of securing the presidency.

With President Elbegdorj’s term up, the Democratic Party has selected Khaltmaa Battulga, a self-made millionaire and judo star. Battulga served as an MP in the previous Democratic government from 2011-2016, occupying the posts of transport and agriculture minister. Battulga is also an outspoken critic of Mongolia’s dependence on China, a dependence underwritten by mining exports. Consequently, Battulga’s stance on China could threaten investor confidence if this sparks a drop in relations or worse. While Battulga is unlikely to antagonize China to the point of sinking the Mongolian economy, if elected he could try to take the country in a new direction, either via economic diversification or seeking out other trading partners. The latter is a tricky prospect given Mongolia’s isolated and landlocked position.

As for China, President Xi Jinping extended his country’s offers for continuing assistance and cooperation, as well as noting that Mongolia is welcome to actively participate in China’s One Belt, One Road (OBOR) plans, during the OBOR summit from May 14th – 15th.

The MPP has chosen parliamentary speaker Miyeegombyn Enkhbold as its candidate. Expect more of the status quo from an Enkhbold administration, as the MPP seeks to further consolidate its grip on power in 2017. To this end, the MPP government has tried to reassure mining interests, with an announcement in early March promising to soon increase the percentage of the country open to mining exploration from the current 9.6% to 20.9%.

The third option

The MPP and Democratic Party have been the two main political forces in post-independence Mongolia; however, the ongoing economic downturn, recycled politicians and corruption has tainted both parties in the eyes of the Mongolian electorate. Opinion polling done before the 2016 legislative election showed that 60% of respondents had little to no confidence in political parties, and that some 60% of Mongolians described themselves as independents. In this context the MPP victory appears as a protest vote against the current government, with the MPP benefiting from being the only viable alternative.

The 2017 election has already seen some controversial candidate choices, with the Mongolian People’s Revolutionary Party (MPRP) initially choosing former president Enkhbayar Nambaryn. The MPRP, a MPP splinter group founded by Enkhbayar in 2010 has a rather fluid identity. Having parted ways with the MPP over concerns of the latter’s drift away from its traditional socialist roots, the MPRP together with the Mongolian National Democratic Party (MNDP) formed the Justice Coalition headed by Enkhbayar to contest the 2012 parliamentary elections. It eventually entered government as a junior coalition partner of the Democratic Party, having won 11 seats.

Enkhbayar was prime minister from 2000 to 2004 and president from 2005 to 2009, overseeing the landmark Oyu Tolgoi deal with Rio Tinto. Enkhbayar remains popular despite being jailed in 2012 for graft. Enkhbayar and his supporters maintain that the charges were politically motivated; a claim seemingly supported by his 2013 pardon by President Elbegdorj. Nevertheless, Enkhbayar was barred from entering the 2017 race because he remains banned from holding office under his original sentence until October 8th.

Bereft of their founder, the MPRP has been adrift, eventually making an interesting second choice in the form of Sainkhuu Ganbaatar. Ganbaatar, who entered the presidential race on May 16th, is described as a resource nationalist, a populist who has agitated against foreign control of Mongolia’s resources for years. Ironically, the party of the architect of the Oyu Tolgoi deal has selected the mine’s most vocal opponent to represent it.

Ganbaatar led calls for a redo of the Oyu Tolgoi deal with Rio Tinto in 2013, calls that helped antagonize relations with the company, eventually leading to the suspension of the $5.3 billion expansion. A conflict over a $340 million tax bill with the Democratic government, and the efforts of resource nationalists, like Ganbaatar pushing for a better deal eventually saw Rio Tinto cut 1,800 Mongolian jobs. The company remained at odds with the government over the issue for years.

The dispute with Rio Tinto severely damaged investor confidence and in part exasperated the impact from the global commodity downturn which was accelerating at the same time. It was only last year that Mongolia and Rio Tinto finally agreed to proceed with the Oyu Tolgoi expansion. Having committed economic and political capital to the expansion, Rio Tinto is now vulnerable to a surprise political upset by Ganbaatar.

Ganbaatar now finds himself running for president, aiming to capitalize on the frustration surrounding Mongolia’s economic situation – a situation which Ganbaatar helped create. The new polling regulations, combined with existing disenchantment with established parties and the high percentage of self-reported independents could all potentially benefit Ganbaatar. A lack of strong party loyalties among many voters, plus an emphasis on personality driven politicking is an ideal environment for a populist. Furthermore, Ganbaatar is also very popular, having captured the top spot (for both 2015 and 2016) in a popularity survey ranking senior Mongolian politicians by polling organization, Sant Maral.

While Ganbaatar’s popularity has slipped somewhat (he lost his seat in parliament in 2016) he nevertheless remains a force to be watched. Indeed, the extent to which his loss in 2016 was due to the general route faced by all non-MPP candidates rather than his personal appeal remains uncertain. Nevertheless, his vocal efforts make him a well-known persona, and his popularity remains robust. Whether he can capitalize on this remains to be seen. Ganbaatar’s position is summed up by Sant Maral head Luvsandendev Sumati: “He’s popular, but people consider that he’s not fit for the office of the president.”



Russia's new passenger plane makes trial flight www.nhk.or.jp

Russia's newest passenger plane made its first test flight.

It followed a successful maiden flight of a new passenger liner earlier this month by rival China.

Russian government-affiliated aircraft maker Irkut developed the new passenger plane, the MC21, using light and durable carbon fiber and other materials.

Irkut officials disclosed that the MC21 made its first flight on Sunday in Irkutsk, East Siberia where the assembly plant is located.

The first flight lasted 30 minutes, with the plane climbing to an altitude of 1,000 meters. Officials say they collected data such as controllability, flight stability and engine performance.

Having received a report on the plane's maiden flight, President Vladimir Putin telephoned those in charge of developing the new airliner to convey his congratulations.

The Russian government plans to sell 1,000 of the new planes over the next 20 years, mostly in Russia and former Soviet Union member-states.

US and European aircraft makers, including Airbus and Boeing, have an overwhelming share for the same class passenger planes with a seating capacity of around 150.

China's new plane made a successful first flight on May 5th as the country prepares to enter the market.

Amid severe competition, the Russian government apparently wanted to show that it is making progress in developing its new passenger plane.



Mongolia | Economic Forecasts | 2017-2020 Outlook www.tradingeconomics.com

This page has economic forecasts for Mongolia including a long-term outlook for the next decades, plus medium-term expectations for the next four quarters and short-term market predictions for the next release affecting the Mongolia economy.

Please click the link for 2017-2020 Economic Forecast




Money supply raised by MNT221 billion www.montsame.mn

Ulaanbaatar /MONTSAME/ Today, May 26, Bank of Mongolia officials made a briefing on economic changes in April. Money supply to the market reached MNT12.4 trillion, up by MNT221 billion, compared to the same period of the previous month. 53 per cent of the supply is tugrug savings and 19 per cent is foreign currency savings. Foreign currency savings have been dropped constantly over last months due to Tugrig’s exchange rate increase against foreign currency, said a senior officer of Research and Statistics Department of Bank of Mongolia A.Anand.

“Outstanding loan amount reached MNT12.7 trillion, up by MNT28 billion compared to last month. Loan by individuals occupies 52 per cent of total loan, while 42 per cent by private companies. 7.9 per cent of them is overdue and 8.6 per cent is insecure. 945 citizens got mortgage loans of MNT56 billion, totaling mortgage balance to MNT4.1 trillion. 1.8 per cent of mortgage is insecure and 2.3 per cent is overdue.

Balance of payments had a deficit of USD164 million, while trade turnover amounted to USD2 billion, up by USD523 compared to the same period of last year. The import growth of oil by USD71 million and heavy machines and equipment import by USD78 million as well as coal export increase by USD440 million influenced it, he said.

The foreign debt of Mongolia is USD24.9 billion in the first quarter, including Government debt of USD5.8 billion and Bank of Mongolia’s USD1.7 billion and debt of commercial banks and other sectors makes 70 per cent of total foreign debt.

Journalists asked questions after the briefing.

How much foreign exchange reserve does Mongolia have now?
Foreign exchange reserve of Mongolia equals to USD1.2 billion, which means equal to 3.2 months’ need supply. Within IMF agreement, the reserve will reach USD1.6 billion at the end of this year and USD4 billion by 2020.

How much mortgage loan is being issued monthly to citizens?
Monthly mortgage issuance totals to MNT25 billion. Next year, mortgage program will be transferred from the Bank of Mongolia to the Government. Now we are carrying out a study with a World Bank expert and the Government.

Economic growth in the first four months has gone beyond the expectation. What were the factors?
Economic growth was 1 per cent at the end of 2016 due to mining sector growth. This year, the growth is expected to be minus 2.1 per cent this year. In connection with mining sector growth, economic predictions have been updated and economic growth would be minus 0.2, according to the new prediction. It is highly probable that the growth would exceed the expectation, if large scale projects are realized successfully.



Mongolia and Czech establish agreement on aviation cooperation www.montsame.mn

Ulaanbaatar /MONTSAME/ On May 25, D.Ganbat, Minister of Road and Transport Development of Mongolia and Ivana Grollova, Ambassador of the Czech Republic to Mongolia signed an agreement on aviation relationship. Thanks to the agreement, the two countries will enjoy opportunity to develop bilateral air transport relations, by conducting direct and charter flight between Mongolia and Czech.

In this regard, it would be open for Mongolia to use an airport of Czech as an intermediate stop when launching new flights from Mongolia to European countries, according to Mongolia's road and transport ministry. 
Minister D.Ganbat, pointing out that transport cooperation between Mongolia and Czech is an important to strengthen the bilateral economic relations, mentioned Mongolia is planning to establish an agreement on international road transport with the Czech. Then, the citizens and enterprises of Mongolia and Czech will take advantage of an opportunity to travel reciprocally, run trade activities, and further opportunities to improve bilateral economic relations and to increase trade turnover will be created.



Foreign-exchange reserves to reach USD 4 billion www.montsame.mn

Ulaanbaatar /MONTSAME/ Today, May 26, Bank of Mongolia made a press briefing regarding the International Monetary Fund's approval of Extended Fund Facility program for Mongolia. D.Orgil, spokesperson of the Bank of Mongolia (BoM) read the central bank's statement, which reported that USD 38.6 million, an initial funding of the Extended Fund Facility program, has been funded to BoM to increase foreign-exchange reserves.

Within the framework of the program, aimed at implementing economic reform in Mongolia, a total of USD 5.5 billion will be financed by international organizations, including IMF, World Bank, Asian Development Bank and JICA, as well as some countries which have bilateral ties to Mongolia, such as Japan, the People’s Republic of China and the Republic of Korea.

The program will provide positive results in the economy such as price stability, increased foreign-exchange reserves to about USD 4 billion, stabilized exchange rate of MNT against foreign currencies, proper foreign debt structures and debt sustainability.

Also, legal reforms aimed at improving BoM’s governance, strengthening its independence and ensuring financial stability will be made. For instance, making amendments to provide legally assured environment of independence to BoM. As well as to provide chance to efficiently resolve issues related to the amendments.

In order to sustain stability in the banking sector, a comprehensive assessment will be conducted in commercial banks. Through this assessment, current situations of the banking and financial system will be assessed in details, enabling for a chance to determine the activities required to expand financial intermediation.

"Healthy and safe operation of banking system will benefit the private sectors by supporting domestic and foreign investments” said D.Orgil, spokesman of BoM.



Mongolia has potential to lead the region in renewable energy production www.montsame.mn

Dr. Enebish Namjil is a professor at the National University of Mongolia. He worked as administrator for the Darkhan Solar Plant Project (10MW) which commissioned its full operations on January 19, 2017 in Khongor Soum of Darkhan-Uul Aimag. Dr. Enebish spoke with the Mongol Messenger during his participation in the 8th National Renewable Energy Forum and shared his thoughts on Mongolia's capability to utilize renewable energy.

First of all, let me congratulate you on successfully commissioning the Darkhan Solar Plant. How is the plant’s operation going? To what extent does it contribute to the central energy network?
The project was successfully completed. Mongolia’s total electricity consumption is roughly 1GW. Nearly 90 percent of this demand is met by the centralized energy system which means 800-900 MW. The 10 MW of energy produced by the Darkhan Solar Plant is a tiny contribution.

In your opinion, which one of the three main sources of renewable energy – water, wind and sun – is the most viable in Mongolia?
All three of them are viable in our country. All we need to do is to come up with the right and ambitious policy. While Mongolia can be ranked 5th in the world with its underground mineral resources, it can top the globe with its capacity to utilize renewable energy. The Mongolian Gobi desert is advantageous for it is studied more closely compared to other deserts such as the Sahara and Arizona.

Starting in 1999, we teamed up with international experts and studied feasibilities of the Gobi for utilization of renewable energy and even came up with technological solutions to exploit the great resources. Our studies have proven that mega plants with 10-100 times larger capacities than the total energy consumption of Mongolia can be built in the Gobi. Mongolia has nothing to lose because such plants only require a minuscule part of the vast Gobi region. The land will not be dug or depraved in any way; it will only be used for its sunlight and wind. Mongolia will benefit from the high-tech and possibility of exporting the excess energy that's produced. Only the tax revenue of such amount of renewable energy exports will be enough to increase Mongolia’s GDP several times.

Will these large developments require a great amount of other type of sources such as water?
Renewable energy plants never use millions of tons of water like thermal power plants. Water will only be required for drinking and cleaning the main equipment once or twice a year. Wind farms do not use water for their operation. Besides, Mongolia has a chance to prosper utilizing the power of its surface water source. Isn’t it regretful to know that we are wasting ground water, which is a more precious resource than gold itself, just to operate the cooling system of thermal plants and see the ground water evaporate in a few years? The world's most developed countries have actually been practicing utilization of surface water for development. The usage rate of surface and ground water is normally 90:10 in developed nations, whereas the rate is almost the opposite in Mongolia.

Does this mean you support the building of hydropower plants in Mongolia?
Absolutely...hydro-plants use only the flowing force. The important thing is to build them according to proper standards and technology.

What's your opinion of Orkhon-Gobi project?
I take it as one of the best initiatives in terms of its significance in expanding green zones in the Gobi region and improving drinking water supply to the Gobi. There are many projects such as Orkhon-Gobi with similar technological models in other countries. Orkhon-Gobi project is one of the most outstanding alternatives of making use of the surface water that flows through the territory. As such, I think this is the best project so far that offers the use of surface water to satisfy the water consumption of Mongolia. In its absence, major mines in the Gobi, namely, Oyu Tolgoi and Tsagaansuvarga obviously use ground water. As I said earlier, ground water is more precious than copper or gold. It is reckless that we are wasting something more valuable to produce things of less value. There is no disadvantage for Mongolia to become a renewable energy producer. It will require land area which would equal to less than one percent of the country's territory, yet be enough to make this country wealthy by multiplying the GDP several times. Renewable energy resources, for Mongolia, are an unexplored "gold mine".

Does Mongolia have enough professional cadres to move such large-scale projects forward?
Mongolia does have a certain level of professional force. The government has been attaching greater importance to the issue. I can name the agreement with the Government of Japan on preparing 'One Thousand Engineers'. Training specialists in renewable energy and electrical engineering is a priority. There are renewable energy engineering courses opening at the Mongolian University of Science and Technology and 20-30 students graduate every year. I am a lecturer at the National University of Mongolia. Ten students from the university are studying in Japan to earn Master's and Doctor's degrees in renewable energy. Also, to operate wind farms or solar plants requires only two or three highly-skilled engineers. Only two engineers are operating the Darkhan Solar Plant, commissioned recently. Combined with three security guards, three dispatchers, a director and driver, only 11 personnel are required to run the whole plant. On the other hand, a thermal power plant with equal capacity as the solar plant hire 300-400 workers just to run smooth operations.

Can Mongolia become exporter of renewable energy?
The very lucid example of reaching the goal of establishing export-targeted production might actually be the production of renewable energy. Especially, producing solar and wind energy is a development passage for Mongolia. For the time being, mining is the main source of our country's income; it is an inarguable truth. Nevertheless, Mongolia can certainly become a regional pillar of renewable energy production. In order to make this come true, the Government should commit uncompromisingly to carry-out negotiations and deals with our two great neighbors and other countries in Northeast Asia.

The interview first appeared in the Mongol Messenger's issue No. 19 for May 12, 2017



Belt and Road Initiative opens window of opportunity for Nepal: Stakeholders www.chinadaily.com.cn

KATHMADNU - Nepali stakeholders have said that Nepal's participation in China-proposed Belt and Road Initiative has opened window of many opportunities in the areas of trade and investment.

Nepal and China had signed a Memorandum of Understanding on Belt and Road Initiative on May 12 in Kathmandu before Nepali delegation led by Deputy Prime Minister and Finance Minister Krishna Bahadur Mahara participated the Belt and Road Forum for International Cooperation in Beijing on May 14.

Speaking at the 14th meeting of Nepal-China Non-governmental Cooperation Forum on Thursday, a platform of apex private sectors of two countries, Mahara said Nepal should take advantage of the opportunity to attract more Chinese investment in Nepal.

"Nepal is very much keen to take advantage of China's high economic growth," he said.

Bhawani Rana, President of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), the apex private sector body of Nepal, said following the signing of the MoU on Belt and Road Initiative, the door has been opened for more cooperation between two countries.

"There is a lot of scope of investment from China in the areas of hydropower, manufacturing sector, tourism and road infrastructure under public-private partnership modality," she said.

The forum was formed in 1996 with the joint initiative of FNCCI and All China Federation of Industry and Commerce (ACFIC) to promote economic and business cooperation, joint ventures and cultural exchanges from the private sectors of two countries.

On the occasion, Chinese Ambassador to Nepal Yu Hong stressed that Nepal needs to take measures to improve investment climate including in the areas of policy stability and infrastructure development.



Alibaba to lead $1bn funding for food delivery startup www.rt.com

E-commerce giant Alibaba and its financial services affiliate plan to lead an investment round of at least $1 billion in a Chinese food delivery service, sources told Bloomberg.

According to people familiar with the matter, the financing will value startup Ele.me at $5.5-$6 billion. It will also help to compete with firms like Meituan-Dianping for the massive Chinese market.

Apparently, Alibaba’s investment is motivated by rival Tencent Holdings being a stakeholder in Meituan-Dianping and also has a small stake in Ele.me.

China’s two largest internet companies Alibaba and Tencent have been focusing on the so-called on-demand services as a way to promote their lucrative online payments services.

Sales of on-demand services are expected to exceed $1 trillion this year in China as people turn to their smartphones or the web to order food, schedule beauty treatments and hire domestic helpers. Growth in local food and restaurant transactions is forecast to outstrip many other retail segments in the world’s second-largest economy.

Tencent is now “putting up quite a big initiative around the restaurant vertical” to propel WeChat Pay, said the company’s President Martin Lau. He added the firm had lost market share in restaurants but is “putting aside a pretty good budget to get back on the competition front.”

Alibaba’s deal with Ele.me which translates from Mandarin as “Are you hungry now?” was first reported in December 2015. The startup has previously raised $3 billion from Uber competitor Didi Kuaidi and a group of investors.



Denmark & other EU members may soon be forced into the euro www.rt.com

Even though Denmark has already voted against dropping the krone for the euro, the European Commission may coerce the country to adopt the European single currency, reports German newspaper Frankfurter Allgemeine Zeitung.

The notes leaked from last week's meeting in Strasbourg revealed the EU Commission wants all 27 members of the bloc to adopt the euro by 2025.

Officials from the EU are reportedly seeking to draw up a euro budget able to incorporate a fixed tax payment from all the member states. The raised cash is for investment across the bloc.

However, the EU Commissioner for the Euro and Social Dialogue Valdis Dombrovskis, says the whole thing has been misunderstood.

“There has been some confusion. What we discuss in the coming reflection paper is the completion of the economic and monetary union. It doesn’t mean the EU member states must adopt the euro. There is no specific time schedule, but we naturally encourage all member states to make the necessary preparations,” the EU Commission’s Swedish site quotes Dombrovskis.

The euro is the sole currency for 19 members of the bloc. The nine remaining countries, including Bulgaria, Croatia, Czech Republic, Denmark, Hungary, Poland, Romania, Sweden, and the United Kingdom, that is currently in the process of quitting the EU, do not use the euro as the main national currency.

The EU Commission is reportedly due to hold a meeting regarding the future of the euro on May 31. The cabinet wants to re-establish control over the euro, according to the German tabloid.